Q1: What exactly is the Package Travel Directive?
Read the factsheet here:
Q: What types of holiday bookings are covered under the Directive?
The new Directive applies to three types of travel arrangements. These are traditional pre-arranged packages, customised packages, and linked travel arrangements.
Traditional pre-arranged packages – These are ‘ready-made’ holidays made up of at least two of the following:
- Car rental
- Other tourist services – for example, tours/excursions/guides or tickets for concerts/theme parks.
Customised/dynamic packages – In this type of package, it is the consumer who selects the components of the holiday, therefore, it is not-prearranged. The booking must be purchased from a single point of sale, either online or offline, and all the components must relate to the same trip or holiday.
The new Directive focuses on the features/characteristics of a holiday booking to assess whether the arrangement constitutes a ‘package’. Therefore, the customised/dynamic package must comprise:
- A single contract for all services.
- Separate contracts for the different services, but:
- Purchased from a single point of sale.
- All services must be selected prior to agreement to pay.
- There must be an inclusive/total price.
Linked travel arrangements
This is a completely new category which, although not considered a package, now has some protections under the new Directive; in situations where the provider of the first service goes bankrupt by providing a money-back guarantee and, where appropriate, repatriation. According to the Directive, a linked travel arrangement means at least two different types of travel services purchased for the same trip or holiday, not constituting a package, resulting in the conclusion of separate contracts with the individual travel service providers.
It is a linked travel arrangement if:
- A traveller books and completes the purchase of one travel service;
- He/she is then invited, through a targeted link, to ‘click-through’ and book a second service on another website;
- The second contract is concluded on the second website within 24 hours of the first booking.
When the second booking is made:
- The traveller must be informed that he/she is not booking a package (and therefore, can only avail of insolvency protection);
- The second trader must inform the first trader that a contract has been concluded.
Q What is the difference between package travel, customised packages and linked travel arrangements?
Package travel refers to a pre-arranged combination of at least two different types of travel services (such as transportation, accommodation, and other tourist services) that are sold at an inclusive price. For example, a package holiday might include a flight, hotel accommodation, and transfers between the airport and the hotel. Under EU law, package travel is subject to a high level of consumer protection, which includes the right to clear information, the right to cancel or change the booking, and the right to financial protection in the event of the travel company’s insolvency.
Linked travel arrangements, on the other hand, refer to two or more separate travel services that are purchased together, but are not sold at an inclusive price. For example, a consumer might book a flight through one company, and then separately book a hotel stay through another company. In this case, the two bookings are “linked” because they are made through the same booking portal or agent. However, because the travel services are not sold as a package, they are not subject to the same level of consumer protection as package travel. Instead, the travel company selling the linked travel arrangements is required to provide insolvency protection, as well as clear information about the arrangements and any changes that may occur.
A customised/dynamic package is a travel arrangement that is put together by the consumer themselves, often using an online booking portal or aggregator. The consumer selects individual travel services, such as flights, accommodation, and activities, and combines them into a single booking. The consumer is free to choose the specific travel services they want, and the price of the package will depend on the combination of services selected.
In summary, package travel refers to pre-arranged combinations of travel services sold at an inclusive price, linked travel arrangements refer to separate travel services that are purchased together but not sold at an inclusive price and while customised/dynamic packages are put together by the consumer themselves and sold at a variable price.
Package travel is subject to a higher level of consumer protection than linked travel arrangements and customised packages.
Q: Has the new Directive provided any other benefits for consumers?
The Directive provides for additional and reinforced rights for travellers, including supply of information, stronger cancellation rights, and financial guarantees. The benefits include:
- Supply of pre-contractual information – Pre-contractual information must be provided to advise the consumer if there is the possibility of a linked travel arrangement arising via a ‘click-through’ booking. This information should be provided even when the contract between the traveller and the second trader is not concluded or, if it is concluded, no later than 24 hours after the confirmation of the first reservation.
- Cap on price increase of eight per cent – An increase higher than eight per cent gives the traveller the right to cancel without a charge being applied.
- Right to transfer – The traveller can transfer to another traveller once the incurred costs are covered.
- Increased accountability – The organiser must try to resolve an issue if something goes wrong with the package. Traders will be made explicitly liable for booking errors in relation to packages and linked travel arrangements.
- Right to assistance if in difficulty – The organiser must provide information regarding healthcare, local authorities and consular assistance, and assistance for communications and alternative travel arrangements.
- Right to rectification of issues – The traveller has the right to have issues rectified whilst on holiday and may be entitled to compensation for the inconvenience.
- Financial guarantees in the event of package organisers or suppliers of linked travel arrangements going out of business – Pre-payments protected and repatriation (if appropriate) are covered.
- Stronger cancellation right – Travellers may cancel their booking within a reasonable time prior to travel. However, justified cancellation fees may be incurred.
- Free cancellation in instances of unavoidable and extraordinary circumstances – The traveller has the right to cancel the contract before the start of the package without paying any termination fee in the event of unavoidable and extraordinary circumstances such as national disaster, war, terrorism, disease, or serious conditions at destination. The traveller’s personal circumstances should be considered when deciding if unavoidable and extraordinary circumstances has occurred. The organiser is also responsible for covering the costs for repatriation and any possible extra costs.
Q: Are there any circumstances where my holiday is not covered by the Directive?
There are some exceptions. This includes:
- Packages/linked travel arrangements lasting less than 24 hours, unless overnight accommodation is included.
- Packages/linked travel arrangements organised on a not-for-profit basis and, only offered occasionally and, only offered to a limited group of travellers.
- Packages/linked travel arrangements purchased via general agreement for arrangement of business travel.